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Scaling growth at Sharpe Farm

Three Ontario brothers grow their ability to achieve their goals

In today’s business world, few concepts are more important than growth. Most entrepreneurs are constantly looking for ways to expand their business to increase profitability and improve their shot at long-term survival.

Of course, farmers and other agribusiness owners are no exception, and for Michael, Paul and John Sharpe — the three brothers behind Sharpe Farm Supplies based in Guelph, Ont. — while growth has always been on the agenda, things have definitely accelerated over the past few years.

Their business operates under the four pillars of agronomy, grain, feed and farming, and it is supported by 110 employees across the province.

The amount of change is staggering. Similar to many farm family endeavours, the Sharpes’ business has simpler roots. The company was founded by parents Bill and Marion Sharpe in 1986 to meet a local need for seed, fertilizer and herbicides. The business quickly diversified to include custom application of their products, and later, an elevator expansion allowed them to dry and store grain beyond what they produced themselves.

It was in 1995 that the Sharpes first diversified into a sector that continues to represent their biggest growth opportunities to date — feed. Sharpe Farm Supplies, led by Bill and Marion at the time, purchased an equine-specialized Purina dealer and grist mill called Top Notch Feeds in the nearby community of Moffat.

“There are lots of opportunities but you have to find the ones that make sense for you,” says Paul (right), with John and Michael.
photo: Deb Deville

Fast-forward 25 years and the diversification strategy has turned into an acquisition strategy. The Sharpes have acquired 11 other businesses, including five since 2018.

So how have they navigated the decisions that accelerated their growth?

Putting the focus on growth

It started with goal-setting and planning. “We have always been a growth-focused company. Dad was that way and all three of us think that way,” says Paul, who along with his brothers joined the business full-time after graduating from the Ontario Agricultural College at the University of Guelph.

He remembers Michael attending a Syngenta meeting years ago and sharing his takeaway — farmers need to learn how to plant a flagpole that represents what they want to become.

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The analogy hit home and the brothers spent time creating a vision of what they wanted their company to look like in the future.

“You devise the plan and then focus on execution, which is the hardest part,” says Paul. “Our business plan has evolved over time as we have grown ourselves and the business has matured.”

Michael says it has been important to choose niche markets. When the opportunity was to buy one grain elevator in a crowded market versus acquiring five feed store locations with niche markets for the same price, the direction seemed obvious.

Sharpe Farm Supplies ranks first in equine feed sales in Eastern Canada and their success in this area drives part of their growth strategy. “The equine circle is a much bigger business than most people think, so it is part of our strategy to add retail stores in areas like the Golden Horseshoe where there are more horses,” says Paul.

“I’ve been at many meetings where they tell you to focus and do really well at one specific thing,” Michael says. “We did not take that lesson very well.”
photo: Deb Deville

Aquaculture is another sector they recently incorporated into their business. Under the label Bluewater Fish Feeds, the Sharpes now hold the second-strongest market share position in aquaculture feed in Ontario.

Acquiring existing feed businesses has been a key avenue when it comes to their expansion. It’s a trend that started with Top Notch Feeds and has evolved over time as the Sharpes learned just how many mom-and-pop style feed stores in Ontario have no succession plan nor buyer interest.

Paul says there are a significant number of these businesses and many of the owners are looking to retire or want to continue working in sales but let go of many of the administration aspects of their store.

Growth versus scaling

For the Sharpes, this spells opportunity. They had spent years doing what business experts would call growing, that is, adding resources so their revenues could climb at essentially the same rate.

Now, they can scale, which means the goal is to add revenue at an exponential rate while adding resources at an incremental rate.

By the fall of 2016 the Sharpes realized their growth strategy meant they would have to make some operational changes, and fast. They had acquired two feed businesses that year and were operating out of six warehouses.

“Our trucks were running between stores and warehouses and making customer deliveries while sometimes driving past each other because of what products were where. It was chaos,” says Michael.

Everyone involved knew they could not continue to grow or transition to scaling without changing their system. The realization led to many strategic planning conversations and ultimately the construction of a 43,000-square-foot feed distribution centre on the home farm in Guelph in 2018.

They now have a product hub where customer service is the focus.

“It is open early in the morning until late at night so carriers can come in and wholesale customers can pick and load inventory. It has made it a lot easier to scale our business,” says Paul.

Specialized skills

These infrastructure changes have also driven human resource advancements. “As you grow, you specialize more and more,” says Paul, who jokes he and his brothers used to wear 10 proverbial hats each and are down to about two.

Once their business started scaling, their hiring strategies evolved.

“We have systems in place for human resources and things like payables and collections so we are not hiring someone who has to wear all of those hats at a store anymore; we are hiring someone who can run a retail store in their community,” says Paul.

“You have to understand what skills you have, and then realize that you can delegate,” says Paul.
photo: Deb Deville

And at the distribution centre, for instance, they’re specifically looking for someone who understands efficient logistics and inventory control measures.

While two such roles — a retail manager and an operations lead — were never really created for the same person, every entrepreneur knows that jacks-of-all-trades are part of starting up and growing enterprises.

Now, Paul says team members are actually enjoying their jobs more because they are increasingly specialized and doing more of what they love to do.

Scaling allows Sharpe Farm Supplies to operate more efficiently and to on-board new locations faster. In fact, their last feed store acquisition was completed and on stream in just four weeks.

Team development

What hiring lessons have they learned through their growth?

“Good people attract good people so you have to create a company culture,” says Paul. The goal at Sharpe Farm Supplies is to have a culture where all team members are passionate, enthusiastic, trustworthy and capable.

Michael and Paul agree there have been many employees over the years and now who possess these qualities and have greatly contributed to the company’s success.

While the brothers gradually learned to delegate over time, this has become critical to reaching their goals.

“You have to understand what skills you have and then realize that you can delegate,” says Paul. They selectively hire people who can add to the business’s strengths.

As they grow, there are other considerations too. “We have expanded to northern Ontario and are now building the largest store to date near Sudbury,’” Paul points out. “That location is four-and-a-half hours from home so there has to be management there who we trust and enough team communication to run it like a well-oiled machine.”

Family roots

Perhaps this advice sums up the relationship between the Sharpe brothers best. Michael says each of them has unique strengths and weaknesses and slightly different interests. “We never sat down and divided up responsibilities but it flowed naturally and our strengths, meshed together, work incredibly well,” he says, while acknowledging that not all families share this experience.

Business development is a passion for Paul so he manages the feed and grain pillars of their company. Michael studied crop science in university and now leads their agronomy division and crop farming enterprise. John, who excels at relationship building and is dedicated to working with other producers, oversees trucking logistics as well as day-to-day operations at the grain elevators and beef feedlot.

Paul says managing different pillars but not adopting a bureaucracy is what allows them to stay nimble and pivot quickly. “Our growth has accelerated but if we need to do something, the three of us can still have a five-minute conversation, come to an agreement on a decision and go do it.”

There’s no doubt the brothers demonstrate scalability in agriculture but they’re also a good example of diversification.

“I’ve been at many meetings where they tell you to focus and do really well at one specific thing. We did not take that lesson very well,” jokes Michael. He says they have diversified in many directions but they also strive for balance.

When the Sharpes are evaluating a new venture or one is presented to them, Paul says they first compare it to their flagpole vision. “You have to ask if it fits your strategy and if you can bring synergy and value. There are lots of opportunities out there but you have to find the ones that make sense for you at valuations that make sense.”

Michael says some opportunities come directly from their team members. “We have a lot of staff who are really passionate and dedicated to one sector. Letting someone run with their own idea can be a game changer. If it is good for them and our customers, then it is good for our overall business,” he says.

Sharpe Farm Supplies now has nine retail locations across the province in Guelph, Moffat, Fergus, Freelton, Shelburne, Desboro, Espanola, Sudbury and St. George. They offer grain elevator services in Guelph and newly in Swinton Park.

So, what’s the next expansion? It’s an e-commerce website that, like all things virtual, was spurred by the start of the COVID-19 pandemic last spring. This online feed store will be the first of its kind in Ontario and will allow the Sharpes to scale the strong base they have built and service new and existing customers in a more efficient way.

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